A parent’s job, they say, is never done. And that includes helping with money matters, according to a survey published this month by the online brokerage firm TD Ameritrade. (The survey, conducted in October of 2016, includes input from some 2,018 American adults. Half of the respondents were Millennial-age parents; the other half were grandparents with Millennial children.) 

Don't expect independence from your Millennial kids. More than half of grandparents still provide their adult children with financial assistance, according to the analysis. In total, 54% of Millennial children said they received support from their parents within the past year. 

The grandparents were especially accommodating when their adult children were raising kids as a single parent – 63% of these solo parents obtained financial help, as opposed to 52% of married children.

A Vital Source of Income

On average, the grandparents said they gave their adult children $4,527 within the past year. And that’s roughly $2,000 more than Millennial kids said they received. 

In part, the discrepancy may reflect their discomfort accepting financial support from Baby Boomer parents. About a quarter of the Millennial respondents said they feel “embarrassed” by their continued need for assistance.

The money went toward a variety of different needs. Forty-five percent of grandparents contributed toward groceries, for example, with an average expenditure of $898. And about four in 10 help with meals out and entertainment, which amounts to another $632, on average. 

Figure 1. Grandparents claimed they spent $4,527 on their adult children within the past year, an amount that helped defray a number of different costs.

Source: TD Ameritrade

In many cases, that assistance was a big difference-maker. Twenty-six percent of Millennial parents said they wouldn’t be able to maintain their lifestyle were it not for their parents’ largess.  

The study also reflects the soft spot that Boomers have for their grandkids. On average, they said they provided another $2,383 for their children’s kids. The most common expenditures were for clothing and toys. However, the biggest expenditure tends to be college savings, with the average grandparent kicking in $452 for the year. (See How 529s Can Hurt Grandparents.)

Setting Boundaries

The research demonstrates the degree to which parents help their families, even when their sons and daughters are grown. In total, the average grandparent kicked in $6,910 for both their adult children and their grandchildren, according to TD Ameritrade’s analysis. 

For a lot of Boomers, giving that much financial assistance isn’t easy. While most said they’re happy to provide support, as many as 47% of Boomers said they had to make financial sacrifices in order to do so. 

That’s a sign that both generations need to set some ground rules, according to David Lynch, TD Ameritrade’s managing director and head of branches.

“So what’s a good parent or grandparent to do? Work together to set clear limits and expectations for financial support and childcare and discuss the tradeoffs to make the support possible,” Lynch said in a statement announcing the survey. “Both generations can start planning for the future today by setting financial goals.” 

The research revealed the extent to which grandparents provide indirect financial assistance, too. Three out of ten Millennials said they receive help from so-called “granny nannies.” Among those who rely on their parent for primary childcare, the grandparent typically helps for 14.3 hours a week.

The survey assumes that this unpaid labor is worth $300 a week.  Over the course of a year, that means those who get free childcare from mom or dad receive a staggering $15,600 in additional benefits. 

The Bottom Line

It's notable – and no doubt reassuring – that so many adult children and grandchildren can feel that they are not alone in today's often tough economic circumstances. It's good to know you have someone at your back. But the grandparent survey offers sobering lessons worth pondering.

The average American grandparent is still making significant financial contributions to his or her children’s and grandchildren’s wellbeing. Often that help represents a sacrifice, so it’s important for both generations to establish some clear rules for the type and extent of monetary aid. Both How to Balance Retirement Security with Supporting Adult Kids and How to Protect Retirement and Help Adult Kids have useful tips.